In order to understand the mechanisms for the Secretoglobin (SCGB) 3A2's anti-inflammatory and growth factor activities, it is critical to determine the mechanism for regulation of Secretoglobin (SCGB) 3A2 gene expression. To this end, we analyzed promoter activity of the mouse Secretoglobin (SCGB) 3A2 gene using transient transfection analysis, gel mobility shift analysis, chromatin immunoprecipitation, reverse transcriptase-polymerase chain reaction, real-time polymerase chain reaction, and the RNAi technique. We also analyzed the promoter of another member of the same gene family to which Secretoglobin (SCGB) 3A2 belongs, named Secretoglobin (SCGB) 3A1. Secretoglobin (SCGB) 3A1 is mainly expressed in lung airways in mice while its expression is found in other tissues such as mammary gland in human. Secretoglobin (SCGB) 3A1 is known as a tumor suppressor and the expression is suppressed in a majority of mammary gland tumors in human due to methylation in the promoter sequence. Our preliminary results suggest that the expression of Secretoglobin (SCGB) 3A1 and Secretoglobin (SCGB) 3A2 may be inversely related to each other. We revealed that mouse Secretoglobin (SCGB) 3A2 gene expression is regulated by a transcription factor CAATT/enhancer-binding protein (C/EBP) alpha and delta in synergistic interaction with the homeodomain transcription factor NKX2-1. Expression of all three transcription factors increase towards the end of gestation having a peak around birth, and is found in the epithelial cells of the airways, particularly the bronchus. Simultaneous expression of the three transcription factors at the same time allows their synergistic interaction to activate mouse Secretoglobin (SCGB) 3A2 gene transcription in lung. On the other hand, the mouse Secretoglobin (SCGB) 3A1 gene is regulated by a ubiquitous transcription factor NF-Y, and the lung-specific expression of SCGB3A1 is associated with DNA methylation of the promoter. Thus, methylation of the Secretoglobin (SCGB) 3A1 gene promoter appears to play a role in tumor and/or tissue-specific expression. Further, we found that Oncostatin M that belongs to the IL-6 family of cytokines, up-regulates Secretoglobin (SCGB) 3A1 expression while suppressing Secretoglobin (SCGB) 3A2 in time- and concentration-dependent manner. This is one of the aforementioned examples that demonstrate an inverse correlation in expression between Secretoglobin (SCGB) 3A1 and Secretoglobin (SCGB) 3A2. Secretoglobin (SCGB) 3A1 is a marker for the proximal airway while Secretoglobin (SCGB) 3A2 is expressed throughout the airway. This bidirectional regulation of Oncostatin M might imply that Oncostatin M shifts epithelial cells towards those having a proximal airway cell phenotype. If this finding is validated, it would provide great relevancy to human chronic lung diseases, which is characterized by reversible and non-reversible transitions of epithelial cell phenotypes. However, the mechanisms regulating this process are poorly understood. The current focus is on understanding the meanings of the bidirectional control of Secretoglobin (SCGB) 3A1 and Secretoglobin (SCGB) 3A2 expression in lung.